Mobile Payments Today: January's top reads
January is that time of the year when we take a look back at the previous 12 months, while looking forward to what may come in a new year.
Mobile Payments Today helped get our readers started on that task this month with a profile about PayPal, which we named as the top influencer in the payments industry in 2017. That article was the most-read on the site in January by a wide margin.
PayPal has turned itself into a model of sorts for the rest of the industry to follow, and it has done so aligning itself with banks, card networks, mobile-payment providers and just about anyone else works want to work with it.
It's this reason, above all else, why we believe PayPal sets the tone for the industry in 2018.
5. "3 trends for 2018: Safer data, faster payments, better experiences": These areas present great opportunities, but also significant challenges.
Fundamental shifts in consumer behavior, the emergence of new technologies and an evolving regulatory landscape means the payments ecosystem is poised for unprecedented transformation in 2018. The demand for safer data, faster payments and better experiences presents great opportunity, but also significant challenges.
The way we pay is changing. As shopping habits evolve, e-commerce and m-commerce methods such as in-app and one-click ordering are becoming increasingly popular. In addition, the exponential growth of the IoT is introducing a wealth of new payment use-cases, such as connected cars.
Issuers and merchants, however, must deliver enhanced and varied payment experiences in an exceptionally challenging security landscape. The success of the EMV chip specifications in securing the physical point-of-sale means increasingly sophisticated criminals have shifted their attention towards the more vulnerable e-commerce and m-commerce channels. In addition, there must now be an assumption that the personally identifiable information of any consumer can be accessed and deployed by fraudsters, following the various massive data breaches over the years.
4. "Payments chatter invades CES": A CES panel explored the challenges of payments technology, including the difficulty with online payments, glitches in online payment systems, the lack of retail locations that accept mobile payments and problems specific to cross-border payments.
The vision of the "connected consumer" who purchases whatever and wherever they want inspires retailers and brand marketers, but several roadblocks are standing in the way of making this vision a reality. While progress has been made in making in-store payments more secure in recent years, many U.S. consumers are still wary about the security of online payments.
A panel session at CES in Las Vegas titled "Payments Deconstructed" explored the challenges of payments technology. Such challenges include the high level of friction that exists with online payments, glitches in online payment systems, the lack of retail locations that accept mobile payments and problems specific to cross-border payments.
The promise of frictionless, secure transactions in real time from any payment device (be it a kiosk, smartphone, computer or payment terminal) is one that gives the consumer complete control over their purchasing experience, noted panel moderator Thad Peterson, senior analyst at Aite Group, a research and advisory firm for the financial services industry.
However, e-commerce presently accounts for just 9 percent of total retail sales, observed Edward Glassman, executive vice president of account management at Mastercard. While some see this as a sizable number, it only increased by one percentage point in the past year.
3. "The smartphone as a mobile identity device": New mobile technologies make it possible for payments companies to leverage consumers' smartphones as an identity device, enabling compliance with AML and KYC regulations while maintaining the superior user experience that consumers expect.
Digital transformation is disrupting the payments space.
Thanks to the prevalence of smartphones (77 percent of U.S. adults now own one), consumers not only have more payments options than ever before, they also have higher expectations for fast and frictionless transactions. From first enrollment to checkout and payment, consumers demand a seamless and extremely convenient experience. However, meeting these consumer expectations can be a challenge for payments companies, as they must comply with stringent anti-money laundering (AML) and know your customer (KYC) regulations requiring them to verify the identities of all their users.
Fortunately, new mobile technologies make it possible for payments companies to leverage consumers' smartphones as an identity device, enabling compliance with AML and KYC regulations while maintaining the superior user experience that consumers expect.
Over the past few years, AML and KYC regulations have become increasingly stringent, requiring obliged entities such as banks, prepaid card operators, digital currency processors, peer-to-peer payments platforms and others in the payments space to do more to help combat money laundering and terrorism financing.
2. "The many faces of mobile payments": NFC, QR codes and various in-app payment methods have helped change the way consumers pay via a smartphone.
Mobile payments is a broad term. As the ecosystem has developed, various new technologies have emerged to change the way we act and transact in-store.
Some mobile payment technologies are focused on seamlessly connecting the mobile device to the existing payments infrastructure.
After an uncertain start, NFC has emerged as a leading proximity payment technology. The advent of host card emulation (HCE) significantly reduced the complexity for banks and retailers deploying NFC payment solutions, enabling users to make standardized EMV contactless transactions with their mobile device. The position of NFC within the ecosystem was then cemented by the launch of the various OEM Pay platforms, which all use the technology.
As the OEM Pay platforms and mobile wallets solutions mature, NFC mobile payments are here for the long-run, supported by the wider proliferation of NFC-enabled smartphones and an expanding EMV contactless infrastructure. A key future growth trend is the significant increase in the deployment and adoption of wearable payment solutions.
Read the rest of the day.
1. "PayPal sets the pace for the payments industry in 2018": For a company once known as a threat to the card networks and banks, PayPal is now an ally as it pushes forward with digital payments.
When eBay decided to spin-off PayPal into its own separate entity in 2014, many industry observers believed the move would give the digital payments company the ability to become more nimble in the market and achieve true powerhouse status alongside the traditional card networks and payments processors.
To help spur that growth, PayPal hired Daniel Schulman as president and CEO to help prepare it for the eventual split from eBay in July 2015.
Schulman came over from American Express, where he helped set the card network down a path toward digital payments. And he's done the same now for PayPal as the company continues to not only enhance its consumer-facing offerings but also help merchants become better suited to handle customers' changing expectations when it comes to the in-store and online shopping experience.
PayPal's busy 2017 is the reason why Mobile Payments Today selected the company as the top influencer in the industry for the past 12 months. We came to this decision based on the moves payments companies made in 2017 that made an impact on the industry. Mobile Payments Today decided that PayPal indeed was that company.
Will Hernandez Will Hernandez has 14 years of experience ranging from newspapers to wire services and trade publications. Before becoming Editor of MobilePaymentsToday.com, he spent two years as the content manager for PaymentsJournal.com, a leading payments industry news aggregator and information hub published by Mercator Advisory Group. Will spent four years covering the payments industry as an associate editor for multiple publications in SourceMedia's Payments Group based in Chicago.